Customer Lifetime Value (CLV) is a crucial metric for marketers as it serves as a compass guiding their paid media investments. It represents the total revenue a customer is expected to generate over their entire relationship with a business. This metric considers the initial purchase and the potential for repeat purchases and referrals.

Marketers rely on CLV to make informed decisions about where to allocate their paid media budget. By understanding the long-term value of a customer, they can optimize their advertising efforts to target and retain high CLV customers. This means acquiring new customers and nurturing existing ones, as having customers often proves more cost-effective than acquiring new ones.